Arrow Transportation Lease

Is crap if in US dollars.;

 

$205,500.00 truck ???

 

Now it's up to $215,500.00 I can buy tri drive Petes for less.

 

Arrow has a lease? Like the chip hauling guys? News to me lol. Sounds like a terrible deal. Save up some extra money and go finance the truck yourself.

 

That might be structured as a lease, but those are rental prices. Except for the $10,000 and the $30,000. I guess those are just company bonuses. Not to you, but to the company.

So, rent your own. Save ownership hassles. Save "new truck" and emissions systems hassles. Save the $10,000 down, but invest it. Save and invest the $555.55 per month you would have to for the next 54 months (4.5 years) to make the $30,000 buy out. In 4.5 years you'll have $50,000 - $60,000 in that account, plus whatever you have saved from your work. In the meantime, if the work dries up, walk away.

 

Assumptions:

Term: 54 months (4.5 years)
Down payment: $10,000
Buy out: $30,000
Lease / rental: $3,250/m X 54 = $175,500
Kilometers @ 180,000/yr (SWAG) = 810,000
Maintenance / meterage: $0.09/km (if you own that might be the number, if you rent that will be the number) X 810,000 = $72,900

Revenue: $28,000 (gross) X 75% = $21,000/m adjusted gross to the truck X 54 months = $1,134,000


Their plan: your truck cost (excluding fuel, insurance, etc. as that will all be the same regardless) is $288,000, or 25% of truck revenue. Way, WAY too high.

Rental plan: truck cost is $248,400, or about 22% of revenue. Still too high.

I rented trucks (up to six at a time) for three years at a cost of about 11% - 15% of revenue.

You either need to make more, or have less cost. Under their plan you'll probably have a decent, but not spectacular wage, plus you'll get all the extra worry and hassle of ownership, but without the real benefit. You'd be better off as a company driver. Call up Prairie Boy; drive a nice truck, make good money, pension, benefits, etc., and your time off is YOUR time off. No truck repairs. No business accounting. IMHO. YMMV.